Tools and Techniques of PlanningPresentation Transcript
Tools and Techniques of
• Become familiar with 6 different sets of
tools to aid in effective planning
– Techniques for assessing the environment
– Tools for allocating resources
– Tools for production planning
– Tools for project planning
– Techniques for scenario/contingency planning
– Creativity aids
Tools for Assessing the Environment
• Environmental scanning
– Simulation techniques
– Delphi Technique
Tools for Allocating Resources
• Budgeting - a numerical plan for allocating
resources to specific activities
Tools for Production Planning
• Scheduling Tools
– Gantt charts
– “Load” charts
– Linear programming
Project Planning Tools
Process Decision Program Chart
• “Scenarios” are descriptions or stories of
• Enhances managerial thinking
– move from advocacy to exploration
• Anticipation of change brings faster reaction
to uncontrollable events
Anatomy of a Creative “Moment”
Four Tools for Creativity
Belief in your own creativity
Absence of judgment
• Never criticize ideas
• defer judgment
• Display all ideas
• so team members can see and build on them
• record each idea as expressed, without interpretation
• Seek quantity of ideas
• they breed quality
• Set a time limit
• 30 minutes or less
Planning Tools and Techniques
– Techniques for assessing the environment
– Tool for allocating resources - budgeting
– Tools for production planning - scheduling
– Project planning tools
– Scenario/contingency planning
– Creativity aids
Assessing the environment
The screening of large amounts of information to anticipate and interpret
change in the environment.
The process of gathering information about competitors— who they are?; what
are they doing?
Is not spying but rather careful attention to readily accessible information from
employees, customers, suppliers, the Internet, and competitors themselves.
May involved reverse engineering of competing products to discover technical
Screening a broad scope of information on global forces that might affect the
Has value to firms with significant global interests.
Draws information from sources that provide global perspectives on worldwide issues and opportunities.
Assessing the environment Cont….
The part of organizational planning that involves creating predictions of
outcomes based on information gathered by environmental scanning.
Facilitates managerial decision making.
Is most accurate in stable environments.
Applying a set of mathematical rules to a series of hard data to predict
Using expert judgments and opinions to predict less than precise
Collaborative planning, forecasting, and replenishment (CPFR)
A standardized way for organizations to use the Internet to exchange
Time series analysis
Jury of opinion
Sales force composition
Making forecasting more effective
Use simple forecasting methods.
Compare each forecast with its corresponding
“no change” forecast.
Don’t rely on a single forecasting method.
Don’t assume that the turning points in a trend
can be accurately identified.
Shorten the time period covered by a forecast.
Remember that forecasting is a developed
managerial skill that supports decision making.
The benchmarking process
The search for the best practices among competitors and
non-competitors that lead to their superior performance.
By analyzing and copying these practices, firms can
improve their performance.
Form a benchmarking team.
Identify what is to be benchmarked, select comparison
organizations, and determine data collection methods.
Collect internal and external data on work methods.
Analyze data to identify performance gaps and the
cause of differences.
Prepare and implement an action plan to meet or
exceed the standards of others.
Steps in benchmarking
Form a Benchmarking
Prepare and Implement
Analyze Data to
Gather Internal and
Types of resources
The assets of the organization
Financial: debt, equity, and retained earnings
Physical: buildings, equipment, and raw materials
Human: experiences, skills, knowledge, and competencies
Intangible: brand names, patents, reputation, trademarks,
copyrights, and databases
Structural/cultural: history, culture, work systems, working
relationships, trust, and policies
Numerical plans for allocating resources to specific activities.
Used to improve time, space, and use of material resources.
Are the most commonly used and most widely applicable planning
technique for organizations.
Types of budgets
Cash Budget Forecasts
on hand and how
much will be needed
Profit Budget Combines
Revenue and expanse budgets
of various units to determine
each unit’s contribution
projects future sales
Expense Budget Lists
primary activities and
amount to each
Suggestions for improving budgeting
Goals should drive budgets—budgets should not
Coordinate budgeting throughout the
Use budgeting/planning software when
Remember that budgets are tools.
Remember that profits result from smart
management, not because you budgeted for them.
Allocating resources: scheduling,
Plans that allocate resources by detailing what activities have
to be done, the order in which they are to be completed, who is to
do each, and when they are to be completed.
Represent the coordination of various activities.
A bar graph with time on the horizontal axis and activities to be
accomplished on the vertical axis.
Shows the expected and actual progress of various tasks.
A modified Gantt chart that lists entire departments or specific
resources on the vertical axis.
Allows managers to plan and control capacity utilization.
Gantt Chart and Load Chart
Contemporary planning techniques
A one-time-only set of activities that has a definite beginning and ending
The task of getting a project’s activities done on time, within budget, and
according to specifications.
Define project goals
Identify all required activities, materials, and labor
Determine the sequence of completion
A consistent view of what the future is likely to be.
An attempt not try to predict the future but to reduce uncertainty by
playing out potential situations under different specified conditions.
Developing scenarios that allow managers determine in advance what
their actions should be should a considered event actually occur.
Project planning process